Alex Abian via Flickr
May's employment report can best be described as a tepidly good report, that mainly took back losses we saw in several categories last month. You probably already know the headlines, +175,000 jobs added, and the unemployment rate ticked up .1 to 7.6%. Government subtracted -3000 from the 178,000 private jobs number. The broader U6 unemployment rate ticked down -.1 to 13.8% (putting us back at March's level).

As always for me, after the headline the next thing I want to do is look at the more leading numbers in the report which tell us about where the economy is likely to be a few months from now. This was generally good, but mainly in that April's bad numbers were reversed, putting us back a March levels:

temporary jobs - a leading indicator for jobs overall - increased by 25,600.

manufacturing jobs declined -8,000. This is the third month in a row of manufacturing job losses, and is a red flag

the number of people unemployed for 5 weeks or less - a better leading indicator than initial jobless claims - rose 232,000. This places it back in the caution zone nearly 300,000 off its lows.

the average manufacturing workweek rose +0.1 hour from 40.8 hours to 40.7 hours. This is one of the 10 components of the LEI and will affect that number positively.

construction jobs gained 7000.

Now here are some of the other important coincident indicators filling out our view of where we are now:

the average workweek was unchanged at 34.5 hours

overtime hours were also unchanged

The broad U-6 unemployment rate, that includes discouraged workers, fell back from its April level of 13.9% to its March level of 13.8%.

the index of aggregate hours worked in the economy, which last month had been reported to have fallen -0.4 from 98.2 to 97.8, was revised to a -0.1 fall, which was reversed with a +0.1 rise back to its March level of 98.3

Other news included:

the alternate jobs number contained in the more volatile household survey showed a gain of 319,000 jobs, which with April's +293,000, totals over +600,000 in two months.

420,000 people entered the labor force, muting the impact of the slight increase in the unemployment rate.

Combined revisions to the March and April reports totalled -12,000.

average hourly earnings increased $.01 to $23.89. The YoY change rose from +1.9% to +2.0%. Since I expect May CPI to rise at least 0.2%, this will be a real albeit slight m/m decline.

This month's report can be filed under the category of "positive, but not nearly good enough," which basically describes the entire last 3 years. Most of the positive indicators outside of the headline number actually just take back last month's declines. The only - slight - silver lining in the ongoing losses in manufacturing jobs is that we don't rely on those any more for a functioning economy.

There's nothing to get excited about in this report, and while it is mainly positive, there are some warning signs that the metrics are stalling.